Old Mutual Investment Club

Investment Club Benefits and FAQ

Investment Club vs individual saving

For most people, investing for the first time can be a bit daunting. With The Old Mutual Investment Club, you don’t have to take this step alone.

Learn more about investments in a safe and trusted environment.

Pool money and enjoy cost saving benefits on fees and charges.

Network with like-minded people and share common financial and social goals.

Encourage and be encouraged to achieve financial goals.

Manage financial risks by investing in a variety of funds.

How does the Old Mutual Investment Club work?

Your Investment Club will invest in the OM Invest Flexible Plan.

Each member contributes an agreed upon amount.

The contributions are invested. The group can commit to making regular contributions (monthly), once off lump sum payments as and when they are able, or a combination of both.

The pooled amount is then invested into an underlying investment fund or funds. The growth received will depend on the
underlying funds selected.

FREQUENTLY ASKED QUESTIONS

To help you understand the product which your Investment Club will be investing in, the Old Mutual Invest Flexible Plan, we've listed a few categories of questions below. If there is something you need to ask that isn't covered by
one of the questions and answers please give our Customer Service Centre a call on 0860 50 60 70.

Investment Clubs which have been formed and operate in South Africa can apply. The Club would need to have a South African bank account and must have 3 authorised individuals to act on behalf of the club.

Yes, regular investments can be increased, decreased, stopped or restarted at any time. There are no penalties for making these changes but a minimum monthly administration charge will apply if there is no regular investment
set up.

Yes, the due date of regular investments may be changed to any date for debit order payments. Due date changes can only be made three or more working days before the next payment is deducted (as a result of the debit order
lead time required by the bank).

The Investment Club can select a yearly increase percentage (between 0% and 99%) and regular investments will increase each year by this percentage. The Investment Club can also select the increase to be in line with
inflation (CPI) each year or choose to not have any yearly increase applied to the regular payment.

The chosen yearly increase date can be changed at any time before the next yearly increase takes place. Allowance needs to be made for debit order lead times – usually three working days before the next regular investment’s
due date.

Underlying investment Fund/s

The Investment Club will choose the underlying investment in which money must be invested in, to meet the club’s specific investment strategy. Along with funds managed by Old Mutual, our selected range also includes funds managed by other leading fund managers including Nedgroup Investments, Coronation, Prudential and Investec. These funds are referred to as ‘external funds’.

The investment club does not need to commit to a specific investment term for regular investments. The investment club can choose for how long they want to make payments into their plan, and how long they want to keep their money invested.

Fees and Charges

An administration charge of 0.86% per year of the fund value will be charged. This will be deducted at the end of every month. If you do not have a regular investment set up or if the regular investment is cancelled, the administration charge will be a minimum of R23.00 per month. The administration charge can be reduced or refunded with Investment Maximisers.

Asset management fees are deducted by the fund managers of the underlying investment funds which are chosen. The amount of the asset management fees will depend on the funds selected.

Investment Maximisers can help you make the most of the growth on your investment in two ways:

A. Reduction in administration charges
When you choose underlying funds managed by Old Mutual, we will reduce your administration charge on those funds from 0.75% per year to 0.50% per year.

B. Refund of administration charges
At the end of each tax year, we check whether you have invested at least R30 000 in that tax year, across your Old Mutual Invest Plans. If you have, we will refund up to half of the administration charge that you paid during that tax year. The refund will be paid proportionately into the underlying investment funds in your Plan.

There are three types of advice fees which may be payable to the appointed adviser. These fees can be negotiated with the Investment Club’s adviser. All advice fees include VAT. Adviser fees could be a combination of the following:

Financial planning fee: only payable when a regular investment is set up and can be negotiated up to the amount of the first regular investment paid (capped at R10 000).

As-and-when advice fee: negotiable between 0%–3.45% of each investment.

Ongoing advice fee: negotiable between 0%– 1.15% p.a. (calculated as a % of the total investment value).
The as-and-when advice fee and the ongoing advice fee work together in that the maximum of both cannot be paid. If a higher as-and-when fee is negotiated, then the ongoing advice fee must reduce accordingly, and vice versa.

All adviser fees are paid by the Investment Club to the adviser. Old Mutual facilitates the payment to the adviser on your behalf.

Initial financial advice: A financial planning fee is payable to the adviser for the initial financial advice given on choosing this plan and the appropriate underlying investment funds. This fee is only paid if a regular investment is set up at the start of the plan. It is not payable if a regular investment is added to an existing plan.

Ongoing financial advice: The adviser provides the Investment Club with ongoing advice on the continued suitability of the chosen investment funds and the product in general. This advice can be paid for in the form of one or a combination of:

An as-and-when advice fee which is payable to the adviser as, and when, each investment is made.

An ongoing advice fee which is an asset charge (calculated as a percentage of the fund value).

1. Paid from the first regular investment - The financial planning fee can be paid as a once-off amount upfront, funded by the first regular investment. In this scenario, the financial planning fee is deducted from the first regular investment, and the net amount is invested into the chosen investment funds.

2. Paid as a monthly charge - The financial planning fee can be paid as a monthly charge which is paid until the full financial planning fee has been paid off.

In this scenario, the first full regular investment will be invested.

The monthly charge will be calculated as an annual charge of 0.6% of the fund value, which will be payable monthly. This charge will be payable every month until the financial planning fee has been paid off.

The as-and-when advice fee is payable to the adviser as, and when, each investment is made. The amount invested will be net of the as-and-when advice fee, if applicable.

The ongoing advice fee is calculated as a percentage of the fund value and is paid at the end of every month by disinvesting units from the underlying investment funds.

Disinvesting

Yes, the investment club can disinvest money from the plan at any time – with no costs or penalties. Regular disinvestments can also be set up if the Investment Club regularly wants money to be paid out to them from the plan.

Cancelling your Flexible Plan

Yes, after the application has been received and accepted, the Investment Club can request to cancel the plan within 30 days. This is referred to as a “cool-off”. The Investment Club will receive the total amount of investments made, less any market loss (if applicable).

Communication and contact information

Once the application has been received and accepted, a contract pack detailing The Investment Club’s Flexible Plan will be received. Thereafter, we will send the Investment Club a statement every year.

If the Investment Club is looking for financial advice and is currently not in contact with a financial adviser, please call 0860 60 60 60 or email us.

Any information relating to NASASA was included for mere information purposes on its existence and registration requirements. Old Mutual does not have any formal affiliation or partnership relationship with NASASA, and inclusion of this information was neither done with an intention to infer that such a relationship exists.

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